What Is Money Laundering?
Money laundering includes acts which aim to legalise money or other property acquired by way of criminal acts, or conceal its source. These acts are usually conducted by drug dealers, robbers, terrorists, burglars, tax evaders, smugglers, persons who accept bribes, and other persons related thereof.
Law on Prevention of Money Laundering and Terrorist Financing
At the beginning of the year 2008 the new Law of the Republic of Lithuania on the Prevention of Money Laundering and Terrorist Financing came into force. It establishes the preventive measures to be taken by the banks and other subjects in order to prevent money laundering and terrorist financing. The law obliges the bank to identify the customer's identity in certain cases.
The compliance with the requirements for prevention of money laundering and terrorist financing in DnB NORD Bankas is regulated by the Procedure for Prevention on Money Laundering and Terrorist Financing. The purpose of the procedure is to assist the employees of the bank to duly implement in their activity the requirements of the legal acts of the Republic of Lithuania regulating prevention of money laundering.
All structural units of AB DnB NORD Bankas are subject to the Procedure for Prevention on Money Laundering and Terrorist Financing.
Bank Employees Must Ask
The bank must follow the principle "get to know your customer". This implies that bank employees have to understand the customer's actions. In order to know the customer and his activity the employee of the bank submits Private person or Legal person questionnaires to the customer to fill in.
If a customer wants to conclude an unusual financial transaction or the aim of a transaction is not clear to the bank, bank employees must inquire the customer about the aim of his financial transaction or the source of funds. In particular situations the bank may request to present agreements, accounts or other documents confirming the customer's explanations.
Communication and Information
The bank protects all the information provided by a customer concerning their mutual business relations. A customer must inform the bank about any changes to the data. Throughout the entire period of business relations with a customer the bank must verify whether the submitted data and documents are authentic and accurate as well as observe business relations with the client.
Requirements for the Conclusion of Transactions
Before concluding any financial transaction, the bank must identify the customer's identity and verify whether the deals conform to:
- the customer's field of activity,
- the usual cooperation with the bank.
Should the transaction fails to conform to these criteria, the bank must verify the source of the funds utilised in such a transaction.
The Actual Beneficial Owner
The bank must identify the actual beneficial owner. The actual beneficial owner means a natural person who controls the managing body of a legal person or a person on whose behalf and in whose interest a bank transaction is being concluded.
In Case Of Information Denied or False Information Submitted
If a client refuses to provide the bank with the required information about the source of funds or other property (or any other additional data), the bank is forbidden to conclude a financial transaction and may terminate the deals or business relations with the client. If, in compliance with the Law of the Republic of Lithuania on the Prevention of Money Laundering and Terrorist Financing, an assumption about the possibility of money laundering arises, the bank must inform the Financial Crime Investigation Service under the Ministry of the Interior of the Republic of Lithuania.
If the bank does not act in compliance with the legal acts regulating the prevention of money laundering and financing terrorists, the above mentioned Financial Crime Investigation Service may impose sanctions, and foreign states may recommend their credit institutions to discontinue relations with that bank.
Control
The Financial Crime Investigation Service controls the relations between banks and their customers in order to prevent money laundering and terrorist financing.